Mimsy Were the Borogoves

Editorials: Where I rant to the wall about politics. And sometimes the wall rants back.

Fixing unemployment insurance benefits

Jerry Stratton, December 24, 2013

Zucchini squash salesman

How many FDA regulations is this young entrepreneur violating?

I just read another article on what to do about the expiration of unemployment benefits a few days before Christmas, Michael R. Strain’s Back to Work.

At the end, he talks about how improving “economic mobility” could help the unemployed find jobs. For him, economic mobility is little more than shortening commute times by subsidizing extra buses and allocating more money for “better roads, bridges, and tunnels”.

But economic mobility ought to mean much more than transportation. Earlier in the article, Strain notes that:

A report released this summer by the Urban Institute found that nearly half of the long-term unemployed in 2012 had at least some college education. More than 1 in 10 were college graduates, and 4.5 percent held advanced degrees. Nearly two-thirds of the long-term unemployed were in their prime working years, between the ages of 26 and 55.

He goes on to note that these are people with high motivation to find jobs and that Conservatives should really consider spending more money on them. But these are also people with the motivation and skills to create jobs for themselves. A time of economic uncertainty is also a time for experimentation with new business opportunities. It’s less expensive to start a new business when there are more people looking for jobs and more inexpensive opportunities to acquire equipment and space to create.

Why isn’t that happening? Because it’s too expensive to hire people to work in your new business. Because in many cases you end up having to compete with a dying industry being bailed out by the government—an industry that’s shedding jobs when you could be creating them. And the legal environment is also dangerous—the federal government is getting more and more involved with local businesses, requiring more and more expensive lawyers to shield your business from government agents.

The “Affordable Care Act” alone is killing more startups than we can imagine. Add in all of the other paperwork and regulations that a new startup is required to learn, understand, and submit, and it’s no surprise that the cohort that normally creates the next generation of businesses is instead taking their $300 a week unemployment checks and competing for jobs in someone else’s company.

By all means, extend unemployment insurance: big government policies have made it necessary by killing jobs. But tie it to removing the roadblocks to creating new businesses with new jobs. That’s the economic mobility that conservatives should support: not just the ability to drive to your job but the opportunity to make your job.

In response to The Bureaucracy Event Horizon: Government bureaucracy is the ultimate broken window.

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